Hayes said the city maintains about 800 miles of water and sewer lines.

He said the city needs $15.5 million to complete projects already under way and another $3.5 million for new clarifiers at the city's waste water treatment plant on Lafin Road.

The city's treated waste water flows into Cattail Marsh along the east side of Tyrrell Park where wetland plants further remove toxins such as heavy metals from the waste water before letting it flow into Hillebrandt Bayou. Purification in Cattail Marsh allows the city to empty the treated marsh water into the bayou at a higher purity than water currently in the bayou, according to city officials.

The 5 percent increase will amount to an increase of $2.15 million annually, enough to pay debt service on money borrowed for water system improvements, Hayes said.

"Every time we borrow for more upgrades, we have to raise rates to pay for it," Hayes told council members.

The city's monthly water and sewer service bills are combined with the solid waste bill.

Castle Motel

City Council also approved a contract with ARC Abatement of Houston to remove asbestos at the Castle Motel, 1125 N. 11th St., and demolish the property, built in the early 1950s.

The Castle has been vacant for several years and is secured by a chain-link fence.

The contract amount is $242,298. The city sent out bid proposals to 13 vendors and received nine back.